In a judgment of 26 March 2014, the Higher Regional Court of Düsseldorf has rejected an appeal by Danish hearing-aid manufacturer GN Store Nord A/S against a judgment by the Regional Court of Cologne that rejected GN Store's action for damages in the amount of more than € 1.1 billion against the German Federal Cartel Office (FCO).
In the first German case in which the FCO was the target of an action for damages, GN Store sought compensation for damages resulting from the FCO's 2007 prohibition of the merger of GN Store's hearing-aid business with Phonak Holding AG. In its judgment of 26 February 2013, the Regional Court confirmed that the FCO officials had breached their official duties because the prohibition decision had been unlawful. However, the Court held that GN Store had not demonstrated the required intent or negligence on the part of the FCO officials as there had been no indication that they had arrived at their conclusions without careful examination of the legal and factual bases (see VBB on Competition Law, Volume 2013, No. 4, available at www.vbb.com).
The Higher Regional Court has now confirmed the Regional Court's reasoning. The FCO's prohibition decision had been the result of an extensive examination of the facts involving numerous difficult legal and factual questions. According to the Higher Regional Court, the legal view taken by the FCO in its prohibition decision had been defensible at the time of the decision. The Court notes that, if an official takes a view after careful examination, and this view is legally defensible, the official cannot be considered at fault if this view is later overturned by the courts. At the time of the prohibition decision, the interpretation of the German provisions on collective dominance had not yet been clarified by the German Federal Court of Justice.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.